Posted
by
kdawson
on Thursday September 23, 2010 @12:47PM
from the most-wanted dept.

netbuzz writes "After a review, the US Patent Office has issued a preliminary finding that the Electronic Frontier Foundation calls 'an important first step in busting a patent that stifles innovation and the use of VoIP as a free speech tool.' (Here is the EFF's press release.) C2 Communications has used the patent to extract one-time payments from the likes of AT&T, Verizon, and Qwest."

That would be true - but in this case the predatory company was using the threat of a patent lawsuit to get companies to "license" their patent. The courts didn't have to be involved in a way that could be overturned.

I think that such a suit would lose badly - since it would require that C2 did something illegal to get each company to sign on as a "licensee", or that C2 did not at that time have a patent [they did].

Of course, now that it is invalidated, if C2 continues to push people to license their patent... then they could run afoul of a lawsuit.

No, not unless there was a clause in the contract. Even crazy-sounding clauses, like "we'll give you a free soda every Friday for 3 years" can be put into a contract - as long as a law doesn't exist to invalidate it. And since they had a patent, the license could have been a legal contract - but was moot once the patent was overturned.

Ok - for better or worse, the U.S. government has to allow you to sue them.

Also - the job of the USPTO is to issue (or not) patents. This means that the USPTO and onlyauthority to issue patents. So - you can't sue them just because they did their job [regardless of whether or not you agree with the execution of their duties].

The USPTO is charged with enforcing the validity of patents, that is, for rejecting applications for what would be an invalid patent.

Their extreme disregard for that duty is costing many billions of dollars. Why shouldn't they be held accountable?

I'm not personally a big fan of all the lawsuits, but in the case of the USPTO, appeal to sense of duty and fairness have fallen on deaf ears for years. Perhaps they should be forced to give up a portion of their rubber stamp budget. Or at the least they need a wak

It's not the individual people at the USPTO, it's the organization as a whole. Yes, it's practically impossible to do a patent search on technology you don't understand, that's why they MUST either hire people who DO understand it or concede that they can't accomplish their charter at all.

USPTO mistakes cost billions and are ruining our ability to innovate. I like Joe down the street. He's a mechanic. That's great and he's a brilliant mechanic. I would still sue a hospital to the ground if they hired him to

IANAL, but I would think that if company A coerces company B into leasing rights to use a patented idea... then the contract would probably have a "too bad sucker" clause in it for just this possibility.

In other words: the contract would either specify the answer and preclude a lawsuit, or it would (foolishly) leave the issue unanswered which might encourage the suit.

Of course, even if companies sued and won the money back, they'd probably never see a penny - the company likely paid out all of its money to employees and/or stockholders. And you can't really sue them.

IA(also)NAL, but I would guess that there's no way you could win a lawsuit on this. I guess I could offer GM a contract that says, "I will not sue you for using wheels on your cars in return for $5," and if they sign the contract, they owe me $5. I don't need to have a patent on wheels for the contract to be legitimate.

"I guess I could offer GM a contract that says, "I will not sue you for using wheels on your cars in return for $5," and if they sign the contract, they owe me $5. I don't need to have a patent on wheels for the contract to be legitimate."

Only GM won't let you $5 for nothing. The contract more probably would say something in the lines of "Due to Suecorp owning a patent on cars using wheels you can't use them without its consent. Suecorp hereby grants you consent in exchange of $5".

the company likely paid out all of its money to employees and/or stockholders. And you can't really sue them.

Can we get this changed? I understand not being able to sue an employee that was just doing a job, but "stockholders" are owners of a company. They benefit when it makes money and suffer when it loses money. Why don't they also benefit (as in no intervention) when it does so legally, and suffer (through jail or fines) when it does so illegally?

So if you invest in a company and the directors (or employees) get the company sued, then you are held responsible for their actions?

Not only will it never happen, but it's an entirely invalid line of reasoning. Just because I give Coca-Cola [or other company] money in good faith and they break the law... I should not be punished for it.

However - if a CEO or board member or employee knows about and approves of criminal behavior, then they are [in the U.S.] held responsible [at least in par

I really wonder if it would be so bad. Instead of people putting hundreds of thousands of dollars into the banks of faceless corporations to get back a few percent, maybe they would try to actually make money with that money themselves. You know... start a business, hire a few employees. Why do they get what amounts to immunity for making money off evil just because they are only a small percentage of the pie, or because they had "good faith" (aka did no research)?

It would be. No one is going to invest in companies that they could be held personally liable for its actions. Why should some mutual fund investor (which make up a whole lot of investors) be held liable for the actions of some company just because the person running the mutual fund bought some stock in that company?

Just seems like a big lack of responsibility and accountability.

Most investors have little or no say in the day to day runnings of a company. It's not as if they have some direct feed into every single decision that the company makes or even have any sway

There should be SOME responsibility though, otherwise why not just invest in the Mafia or the local cocaine distributor? They DO have a rather large profit margin and a very loyal customer base.

If the stock holders bear NO responsibility for a corporation behaving in a legal and ethical fashion, exactly who is going to demand it of the board or the CEO? Especially when illegal or unethical practices can be so profitable.

It would be. No one is going to invest in companies that they could be held personally liable for its actions.

Why not? Risk just doesn't simply disappear. All you're doing is simply transferring the risk to others, mainly the customers and suppliers in this case. They become responsible for the shareholder's inattention. By insulating the shareholders from such risk you are distorting the market and that is a bad thing.

Having shareholder's keep closer tabs on company officers would be a very good thing. A

As I understand it, that's usually the case, but once in a while, they're so confident in their bogus patents they'll agree to a money back clause. SCO made one, but I forgot who it was with. Of course, the subsequent legal wrangling and loss by SCO wiped out all their money, so I doubt that company got back any of the money it was owed.

What you (and, apparently, the moderators) don't seem to recognize is, it is not a perfectly acceptable argument. (I was aiming for "funny", not "insightful", with that particular post. I kind of worry how far we've slid if that isn't obvious.)

What it is, is a satire of the sort of corporate weasle-speak that I would expect in that situation. Calling that argument "acceptable" sets up a form of legalized racketeering.

Patent licenses shouldn't be treated as protection money / promise not to sue. They sho

What you (and, apparently, the moderators) don't seem to recognize is, it is not a perfectly acceptable argument. (I was aiming for "funny", not "insightful", with that particular post.

Actually the attempt at humor (double entendre "we aren't going to") was recognized but it is overshadowed by the fact that the statement is perfectly acceptable in a legal sense. Your comic intent is less important than the legal wrangling, I addressed the later not the former.

Patent licenses shouldn't be treated as protection money / promise not to sue. They should be treated as the purchasing of a right...

Promise not to sue vs purchasing a right, the two are essentially equivalent. if one fails to purchase the right the reasonable outcome is a lawsuit. The later phrase is just the lipstick on the pig, the pig being the ugly truth that

You are confusing the law with reality. In reality, that patent was not valid and that's the point the GP was making. The fact that lawyers and the PTO are fond of redefining reality is a major problem in itself.

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Like software, intellectual property law is a product of the mind, and can be anything we want it to be. Let's get it right.

You are confusing the law with reality. In reality, that patent was not valid and that's the point the GP was making. The fact that lawyers and the PTO are fond of redefining reality is a major problem in itself.

Given that the law decides who gets fined, who goes to jail, etc the law is reality. You are confusing "what should be" with reality, unfortunately "what should be" is often fantasy.

If Americans don't rein in software patents soon, they're eventually going to turn us into a technological backwater.

Can you imagine if mathematicians couldn't use certain types of calculations for 20 years if somebody else happened to use them first? What if fiction authors weren't allowed to use particular combinations of words if another author "registered" them for "protection"?

As a programmer, I'm continually amazed by how backwards, technically-illiterate politicians are tricked (or willingly lead) into outlawing technological advancement. Make no mistake, that's what software patents do. There are a bunch of rationalized lies about "protecting innovators" -- but in the real world, software patents exist solely to profit a few extortionists who use them as an easy way to gain market share without actually inventing anything.

In the real world, software patents do not protect innovations; they protect conceptual monopolists, and hinder actual innovations.

I tend to agree, but your post made me question whether it's software patents as a whole that are the problem, or the fact that so many are so bleeding obvious.

The thing the PTO needs to get their head around is that if the proposed invention is something any competent developer would devise if presented the problem, it shouldn't be patentable. If it's something that takes a competent developer blood, sweat, tears, time, and money to eventually puzzle out a novel solution, hmm, ok, maybe. In other words,

I personally just think it's a blessing that the patent system hasn't started extending the duration, like copyright has. I fully expect that nothing new will ever enter public domain again, because Disney will never again let the copyright on Steamboat Willie approach expiration.

That's the problem with the current patent system in the States. Mathematical algorithms originally were not patentable. Software is really nothing more than mathematical algorithms. And yet, you find software patents, even purely algorithmic patents, running rampant.

1. A method of routing a full duplex telephone call between a first telephone set and a second telephone set using a public computer network as at least part of a communication link connecting said first and second telephone sets, comprising the steps of:

receiving at a first computer network access port a first telephone call from a central office placed from said fist[sic] telephone set initiating said full duplex telephone call, said first telephone call specifying a telephone number of said second telephone set, without specifying additional telephone destinations;

converting data received from the central office to an Intenet protocol;

establishing a communication link over said public computer network between said first computer network access port and a remote second computer network access port;

placing a second telephone call from said second computer network access port to said second telephone set using a PSTN;

converting data received from the public computer network from Intenet protocol to a PSTN protocol; and

connecting said first telephone call, said communication link and said second telephone call to thereby establish a telephone call between said first telephone set and said second telephone set.

A little broad, but then again it was filed in 1995 which is over a year before H.323 was even published. Note the requirement of a PSTN: If you are just making a VoIP call over Skype this patent does not cover that since there is no PSTN. In fact, and Pure VoIP call is outside the scope of this patent. I wonder if the EFF had been around in the 1870's if they would have been accusing Alexander Graham Bell of "stifling free speech" with the original telephone....

Good then you of course will produce all those wonderful references showing the state of technology in the mid 1990's. Note that this patent is NOT covering sending VoIP data over the Internet, rather it is covering interoperability of VoIP with a PSTN. Since unlike you I actually know what SS7 means, I can tell you that this was NOT some widely known technology in the mid 1990's. Sure, the telcos had digital backends for long-haul communications, but they were all circuit-switched backends. Packet-swit

Helpful hint: the mere use of an acronym does not make your straightforward application of ancient concepts "new" nor "non-obvious."

But it may fool a patent office into thinking it is. Which is probably the intention in the first place. Especially if the people employed by that patent office are not fully competent to evaluate the claims in the application.

They were granted a monopoly, because it was in the public interest to have only one, monolithic telephone system, but they had to submit to regulation as a Common Carrier.
I'm one who argues that this should have been the case with the US cellular system. There has been a tremendous duplication of equipment by the various carriers (some of whom are defunct). There's no reason we need three different, incompatible air protocols (except to lock in customers). Every time I pass a cell tower with a half doze

We'd probably have to rent all our phone equipment from AT&T, who would be in no hurry to update their network or services from what they originally installed. Or don't your remember telephony before the breakup?

No, that's pretty much what long distance companies were doing back in the mid 90s. Instead of the internet, they were digitizing calls through a private network, and reconstituting them on the other end. The basic idea is pretty obvious: take a call and route the long distance portion over a free network. That's the easy and obvious part. The hard part (especially in 1995) is the apparatus to digitize and reconsitute the call on the other end. What a

That's what the Bells have been doing since the '70s with ATM circuits. VoIP is just voice on top of IP protocols on top of digital voice circuits. Of course we're starting to see native ethernet circuits now.

I wonder if the EFF had been around in the 1870's if they would have been accusing Alexander Graham Bell of "stifling free speech" with the original telephone....

Hmm...

On June 11 [2002], to little fanfare, the United State House of Representatives declared that the telephone was invented by an Italian-American named Antonio Meucci, a sausage and candle maker. Forget Alexander Graham Bell. The House declared that Bell's patent for the telephone was based on "fraud and misrepresentation."http://hnn.us/articles/802.html [hnn.us]

A little broad, but then again it was filed in 1995 which is over a year before H.323 was even published.

Sure, H.323 was published in late 1996, but that didn't appear fully formed from nothing. I'm curious (a cursory search does not answer this question) how long the working group took to release their final spec--I'm willing to bet it took them at least a year or two, most likely long enough to pre-date the filing of this patent.

Your point about "obviousness" is very well taken, though--for sure, we tend

What's being announced here is a non-final office action in an ex parte reexamination. Basically, the EFF submitted some prior art that presented a 'substantial new question' of patentability and asked the Patent Office to review it. From there, the Patent Office and the patent owner hash things out; the prior art submitter's role is finished. (Prior art submitters can take a more hands-on role via inter partes reexamination, but that's more expensive and time consuming than ex parte reexam).

Reexamination cases are a little tricky to look up because you have to find the control number for the case. The control number in this case is 90/009637, which you can plug into Public PAIR [uspto.gov]. Here is the non-final office action [scribd.com] that is the subject of the post, since you can't link directly to documents in PAIR.

The patent owner will have an opportunity to respond to this non-final office action. If the examiner is satisfied, then that's that. More likely the examiner will not accept the arguments or will have discovered new ones. Typically there are one or two non-final actions and then a final action. After that, the patent owner can still appeal to the Board of Patent Appeals and Interferences. From the time of appeal to a decision is, at median, a couple of years. From there the patent owner could still appeal to the Federal Circuit.

So, while this is a preliminary finding, it is very far from definitive.

To further what you are saying the patent owner can also narrow the claims by adding additional limitations. Also while a new case will possibly have 2 non-finals and then a final, in Reexams it is very frowned upon to have more than one non-final action. Also reexams are done by a select group of examiners who have much more experience and are less likely to make a mistake.

On appeal the appellant can file a brief. The examiner then files an examiner answer to the brief. If the examin